March 25, 2022
Company name:
Representative:Inquiries:Tel:ES-CON JAPAN Ltd.
Takatoshi Ito, President &Representative Director(TSE 1st Section, code: 8892)
Minoru Nakanishi,
Senior Managing Director+81-3-6230-9308

Notice of Revision of Management Targets for the Final Fiscal Year of
the “IDEAL to REAL 2023” Fourth Medium-Term Management Plan
ES-CON JAPAN Ltd. (ES-CON JAPAN) announces decision at today’s board of directors meeting to revise
some of its management targets for FY2023, the final fiscal year of the “IDEAL to REAL 2023” fourth mediumterm management plan, as follows.
1. Background
ES-CON JAPAN has formulated “IDEAL to REAL 2023,” the fourth medium-term management plan, for thethree-year period from the fiscal year ended December 2021 through the fiscal year ending December 2023,
and will promote businesses by setting “Establishing business foundations able to withstand unexpectedchanges in economic conditions” and “Simultaneously changing the revenue structure and expanding businessdomains” as management strategies based on the theme of “Transformation and Rapid Progress.”
Results in the fiscal year ended December 2021, the first fiscal year of the fourth medium-term management
plan, went largely according to plan. The acquisition of Picasso Co., Ltd., a company with an extensive portfolioof outstanding real estate properties generating leasing revenues, and its seven group companies (“PicassoGroup”), making them subsidiaries, has advanced investment plans at a pace beyond initial plans, while also
securing stable leasing revenues. This has meant we were able to rapidly advance on the theme of“Transformation and Rapid Progress”.
Accordingly, we have decided to revise certain management targets including the target of share of profits fromleasing for FY2023, the final fiscal year of the medium-term management plan.
In FY2022 and beyond, we will pursue further progress on transforming the revenue structure as well as pursue
proactive business development, with the aim of setting new record highs for profits, thus defining this period
as one of rapid progress.
2. Details of revised management targets
Fiscal year
ended
Dec. 2020
ActualShare of profits
from leasing*1
Return on equity(ROE)
Return on
invested capital(ROIC)*2

Fiscal year ended
Dec. 2021

Fiscal year ending
Dec. 2022

ActualPlanPlan

Fiscal year ending Dec.2023

Initial plan

Revisedplan

Initial plan

Difference
from initialplan+4.0 pts.

14.2%

21.2%

23.0%

26.0%

24.0%

30.0%

26.0%

21.2%

11.8%

12.0%

13.0%

13.0%

13.0%

13.0% No change

6.6%

3.2%

4.0%

4.0%

4.0%

4.0%

4.0% No change

Equity ratio

25.8%

24.8%

29.0%

23.0%

26.0%

21.0%

23.0%

-2.0 pts.

Share of longterm earnings
from real estate*3

9.5%

20.6%

12.0%

21.0%

14.0%

23.0%

18.0%

+5.0 pts.

38.6
billion yen

62.6
billion yen

61.0
billion yen

67.3
billion yen

66.0
72.0
72.0
billion yen billion yen billion yen

No change

Net assets

1Notes:
1. Share of profits from leasing: Leasing segment profits/Total segment profits (excluding adjustments)
2. Return on invested capital (ROIC): After-tax operating income/(Shareholders’ equity + Interest-bearing
liabilities)
3. Share of long-term earnings from real estate: Real estate generating leasing revenues recorded as noncurrent assets/Total assets
Reference: Overview of the fourth medium-term management plan
◼ Basic Management Strategy Policies• Establish business foundations able to withstand unexpected changes in economic conditions
Establish a sound business and financial standing that can maintain its fund-raising abilities under any
economic environment.
• Simultaneously change the revenue structure and expand business domains
Transform the revenue structure from one based on flows to one based on stock by strengthening thereal estate leasing business while the same time realizing business diversification and expanding
business territories.
◼ Basic Policy: Transformation and Rapid ProgressTransformation• Proactive investment in long-term revenue-generating real estate and improvement of balance sheetstructure• Transform the focus of management from flows to stock
Rapid Progress• Demonstrating synergies within the Chubu Electric Power Group• Achieving net sales of 110 billion yen and operating income of 16 billion yen (in the final fiscal year of themedium-term management plan)◼ Management Strategies• Transformation to a structure of sustained and stable profit revenues• Stable growth in existing core businesses through business diversification and area strategies• Growing new businesses into core businesses through area strategies• Taking on the challenge of new business domains• Enhancing synergies with the ES-CON JAPAN Group• Expanding business bases, primarily in the five major urban areas• Enhancing synergies with the Chubu Electric Power Group• Promoting ESG initiatives◼ Performance Plan

(Unit: million yen)
Fiscal year
ended Dec.
2020

Fiscal year ended Dec. 2021

Difference Increase/from plan decrease

Fiscal year
endingDec. 2023

Fiscal year ending Dec. 2022
Difference
Increase/from initialdecrease
planActual

ActualPlanNet sales

77,30879,01780,000(982)(1.2%) 100,000

98,000

2,000

2.0%

110,000

Operatingincome12,202

10,381

10,800(418)(3.9%)

14,000--16,0002

Plan

Initialplan

14,000Plan◼ Investment Plan

(Unit: million yen)
Fiscal year ended Dec. 2021

Investment in revenuegenerating real estate
Investment in otherdevelopment
Gross investment

Difference Increase/from plan decrease

Fiscal yearending
Dec. 2022

Fiscal yearending
Dec. 2023

Three-year
cumulative
total

Plan

Plan

Plan

ActualPlan

76,79930,00046,799156.0%

40,00060,000130,000

19,191

25,000(5,809)(23.2%)

30,00035,00090,00095,99055,00040,99074.5%

70,00095,000220,000◼ Dividend policy

In the second medium-term management plan, ES-CON JAPAN introduced a progressive dividend policy of“No reduction in dividend; only maintenance or increase in dividend amount,” in principle, with the DPS of theprevious fiscal year as the lower limit. This plan remains in place as the progressive dividend policy for thefourth medium-term management plan. During the period of this medium-term management plan, we will
maintain dividends of at least 38 yen/share.
FiscalFiscalFiscal
FiscalFiscal
year
year
year
year
year
ended
ended
endingended
ended
Dec. 2016 Dec. 2017 Dec. 2018 Dec. 2019 Dec. 2020
ActualActualActualActualActualDividends pershare
Dividend payout
ratio

15 yen18 yen32 yen36 yen38 yen

25.5%

22.0%

30.2%

30.2%

33.9%

3

FiscalFiscalFiscal
year
year
year
ended
endingendingDec 2021 Dec. 2022 Dec. 2023
ActualPlan
Plan
38 yen 38 yen or
38 yen(planned)
more
56.3%

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